The effect of HRM practices on knowledge management capacity: a comparative study in Indian IT industry

Abstract

Purpose Successful businesses demand high-performing human resource management practices (HRMP) and effective knowledge management capacity (KMC) to enhance the overall organizational performance. Rapid growth of both local and multinational companies operating in knowledge-intensive industries has increased the global competition in the labor market, also for the developing economies. Therefore, attracting valuable human capital, retaining talents and managing effectively knowledge to deliver on the latest technologies and innovative solutions and services are the biggest challenges in the modern IT industry. The purpose of this paper is to examine the influence of HRMP on KMC through a cross-case analysis including four companies operating in Indian IT sector. Based on the existing studies in this field, five key HRMP have been identified (i.e. recruitment and selection, training and development, compensation and reward, employee retention and career development), as well as two key processes supporting the KMC (i.e. knowledge acquisition and knowledge sharing). Design/methodology/approach The paper adopts a qualitative research method based on a multiple case study, and it uses primary and secondary data collected through desk research and field interviews. Findings Results show the existence of HRMP aiming to enhance the individual learning, motivation and retention of employees for knowledge acquisition and knowledge sharing, in the strategic perspective to improve the organizational performance. Research limitations/implications The paper presents some limitations, which may provide scope for future research. First, being the study a qualitative multiple case analysis, a more extensive research is needed to generalize the results and investigate further relationships existing between HRMP and KMC. Moreover, a deep investigation on the organizational performance dimensions (e.g. sales growth, cash turnover, financial goal achievement) is required to verify the existence of possible links. Finally, a further limit consists in considering only knowledge acquisition and knowledge-sharing processes, excluding another crucial knowledge management (KM) process such as knowledge application. As for the research implications, the paper contributes to investigate the role of HRMP in supporting KMC in Indian IT companies, which represents a context of research not so much investigated. Practical implications From a practitioner point of view, the study can be helpful to HR and KM managers for motivating employees to undertake learning processes and enhance their performance, as well as to acquire and share knowledge resources that are useful for the organization to remain innovative and stay competitive. Originality/value As the influence of HRMP on KMC has not been widely studied in the Indian IT industry, the study may open the field for further studies on a deeper investigation of the relationships existing between human resources management (HRM), KM and organizational performance in knowledge-intensive industries in India and, more in general, in developing economies.